When looking at your personal finances and assessing if they need an overhaul
, there are five main areas you should consider. These relate to your relationship with the bank when considering your home loans and credit cards, the current status of your will, income protection insurance, and the lodgement of your income taxation returns.
1. Your Current Bank Loans:
Have a look at what the bank is offering you. What is the interest rate you are paying, and what annual fees do you pay for the loans. Speak to the bank; if you don’t ask there is no chance that you will receive. Go to a mortgage broker, they do all of the work for you and it generally costs nothing.
2. Your Credit Cards:
If your credit cards are out of control, have a look at possibly consolidating them into one card. And if you can get a six-month interest-free period, that is even better. This way your payments will go towards the principal debt as opposed to just paying the interest. Going forward, if you don’t have the discipline to pay off your card in full every month, then cancel your credit card and just use debit cards.
3. Income Protection Insurance:
In the event that you are temporarily unable to work, income protection insurance assists in covering your costs of living by paying you up to 75% of your income on a monthly basis. These monthly payments will continue until you go back to work or up until retirement age, which ever is earlier. When one is the primary income earner of a household, to have his/her income stream cease can be a significant financial burden, especially if this income covered your costs of living, including rent or mortgage payments. Income protection insurance assists you in covering these day-to-day costs and the premiums are tax deductible.
4. Income Tax Lodgements:
Apart from the legislative requirements, being up to date with the lodgement of your personal tax returns also ensures that if you do need to present your financial information to the bank, you have everything up to date and easily accessible. Plus, if you are entitled to a refund from the A.T.O., you’d rather have this money in your bank account than theirs!
5. Your Will:
No-one ever likes to think about their mortality and it is definitely not something we like to consider in-depth. But it is important to have your will in order to ensure that if you do pass away, your estate goes to the people that you think are entitled to the wealth you created whilst you were alive. In the event that you leave young children behind, your will also dictates who will look after them and how your wealth is to be preserved for their benefit.
For more information about your finances or to make an appointment with a specialist from Bell Partners click here